Economic analysis in product design — A case study of a TCM dietary supplement

• An approach for the economic analysis of chemical product design is proposed.
• Consumer preferences are translated into technical product specifications.
• Pricing model and make–buy analysis are considered.
• This approach is illustrated with a case study on TCM dietary supplement.

An approach for the economic analysis of chemical product design is proposed. It takes into account of customers' preference on product quality and economic considerations such as pricing, profit, market share, capital investment, and operating cost. The activities needed to support business decision making – identifying product quality, estimating product cost, calculating financial metrics, and performing make–buy analysis – are discussed. The design of a Ganoderma lucidum dietary supplement, a traditional Chinese medicinal (TCM) product, is used to illustrate all the activities in this approach.